Evaluation of an International Human Resource Strategy - Essay Example

Evaluation of an International Human Resource Strategy Inserts His Her Inserts Grade Inserts Introduction The purpose, aim and subject of this report is basically the evaluation of international human resource strategy of Tesco Plc within its local jurisdiction and its start up of new joint venture association with another partner in other country, i.e. in our case is China. I would be writing this report as a HR manager, reporting directly to HR director of the organization. I would be directly and merely responsible and obliged to carry out the entire evaluation and analysis of various HR issues and strategies that has to be watched out and properly planned out when Tesco Plc plans to extend its internal operations and activities to China region. Moreover, I would be discussing the entire chunk of international HR strategy into the following five major and broad categories, namely; Recruitment and selection Training and development Reward management Performance Management Employee Involvement In addition, I would be stressing out the major issues which the Tesco Plc representatives and it HR department would have to be catered with when extending and flourishing its activities into another region of world on the basis of contractual relationships with its new appointed joint venture partners. Furthermore, I would also be discussing and detailing out some of the other relevant aspects and areas related to Tesco plc, which would probably be including; Key economic drivers in the host country A comparative analysis of HR systems globally Cultural and other essential issues that influence the development and implementation of HRM strategy Some vital statistic of international operations in international market by Tesco Plc Highlights on some quantitative measurements and statistics of Company’s performances and financial standings Hence, the overall and comprehensive purpose of this report is the evaluation, recommendation and analysis of vital and relevant international HR strategies and issues with which Tesco Plc would be challenged when it plan out to take certain growth initiatives under is business circle with its foreign joint venture partner in the market area of China. Company profile, brief history and Background Tesco PLC is one of the largest and popular British multinational Company which is directly engaged and associated in the business of grocery and general nature merchandise retailer, having its headquarter in Cheshunt, Hertfordshire in England, United Kingdom (Tescoplc.com, 2014). Furthermore, Tesco Plc is recognized as the second largest retailer all over the globe, after Wal-Mart, when it comes to the measurement of its overall profits and revenues. Company is quite successful in establishing its chain of merchandise stores in more than 12 countries scattered all around the regions of Asia, North America, Malaysia, Thailand, the Republic of Ireland and Europe (Reuters, 2014). In addition, Tesco Plc is essentially considered as one of the grocery market leader in entire region of the UK, where it accumulates the overall market share of approximately 30% on aggregate basis in similar industry. Historically speaking, Tesco Plc was founded by Jack Cohen in 1919 primarily, as a small group of market stalls. And the Tesco name was first appeared and heard in 1924, after its founder, Cohen first purchased a shipment of tea from T. E. Stock well and then diligently combined those initials of (TES) with the initial two letters or alphabets of his own surname, to coin the term which today known as, Tesco. The first Tesco store was opened in 1929 in the region of Middlesex. With the passage of time, his business continues to expand rapidly and dynamically, and by the end of 1939 he owned over 100 Tesco Plc stores and retail shops in one or the other form, across the entire country (Finch, 2010). Originally, a UK-focused merchandise and grocery retailer and chain of stores, since the period of 1990s, Tesco has embarked itself as an increasingly diversified and geographically strong Company, into areas which includes as the retailing of clothing, books, electronics, petrol, furniture, software and other many stuff; like financial services, internet services, telecoms, DVD rental, music downloads and others (The Sun, 2012). Consequently, by the period of 1990s, we all saw Tesco transforming itself into one of the retail stores chain which directly and strongly appeals across the groups of wide social networks and channels, that is, from its Tesco Value it’s converted itself to be known as Tesco Finest ranges. Thus, by the mid of 1990s, the chain of Tesco Plc was grown from almost 500 retail stores to some 2,500 stores in the overall timeframe of fifteen years then later. However, Tesco is also listed on the London Stock Exchange and is a strong constituent of FTSE 100 Index as well since many decades. As of 15 January 2012, it had an overall market capitalization of approximately £24.4 billion, which makes it a 15th-largest company with a basic listing capability the London Stock Exchange (Lse.co.uk, 2014). Moreover, the current tag line of Tesco Plc says that as one of the world’s largest retailers with over 500,000 colleagues, we serve millions of customers a week in our stores and online (Tescoplc.com, 2014) Key economic drivers and analysis of global HR system Tesco Plc is considered and regarded as one of the substantial company engaged in the business of grocery, merchandising and other related aspects and thus, to continue its present range of functions and activities in an ever smooth and swift phase, a company has to keep a regular check and balance over the various changing economic factors and drivers. Such economic driver would certainly be varied from one region to another, for example, a foreign exchange and exchange rate fluctuations would be considered as a logical and justified economic driver, when the management of a Company wants to have a look in its various international trading and transactional operations and on the other hand, such driver would have nothing to do in terms of Company’s local or domestic business operations (Icmrindia.org, 2014). Furthermore, Tesco Plc currently have a team of more than 500,00 employee on a global platform which ranges from some high level skilled and competent workforce to wide number of labor work force as well. However, a Company believes in a policy of awarding equitable compensation and rewarding scheme to be humongest workforce team as per their respective talent, skills and expertise. A company merely believes in, that each of the single person who works in its stores aims directly to helps their customers in providing a positive shopping environment and experience and everyone who dwells behind the scenes operations, has just as crucial a role to play in making sure that we are known for offering great products, esteem service and great value across every pathways and channel and that is the sole reason why our Personnel teams are so essential and pivotal for the Company (Tesco-graduates.com, 2014). Cultural and other essential issues influencing the development and implementation of HRM strategy It is quite evident and logical from the current business structure and growth prospects of Tesco Plc that the company is currently operating in a number of developed and developing countries of the world and each of them do have their own, distinct, established and strong cultural and traditional point of views, understandings, beliefs and other related values and norms. Therefore, one of the challenging issues, out of many, that the management of Company has to cope with is its global HRM structure and related aspects. Moreover, it would not be wrong or illogical to mention here, that to follow the same and unadjusted structure for the development and implementation of overall HRM framework of the Company in all of these countries, in which the company is currently operating its function, would be absolutely wrong  (Vulture, 2012). Because the management would have to face with certain strong and tremendous form of resistance and hindrance, from wide number of human resources of the entire group of Companies, if and when the unadjusted and standard level of HRM strategy would be tried to be implemented on all of them. Thus, the best approach that should be wisely followed and adopted by various components of the management of Company, would be to appropriately give margins and room for adjustments to its overall and current HRM strategy, according to the respective countries cultural and traditional requirements and needs, so that the company get successful in developing and implementing its overall HRM strategy and framework to each of its different market segment scattered all over distinct countries of the world (Global-excellence.com, 2014). Moreover, a Company has to make margins and rooms in its HRM strategy, on more or less, similar terms when it would be entering the market of China with the joint collaboration of its new joint venture partners and vice versa. Vital statistic of international operations in international market by Tesco Plc Tesco Plc international strategy for expansion and growth has successfully responded to mere needs to be more sensitive to some local expectations in different countries over the globe and this done by entering into various joint ventures by Tesco Plc with some of their string and prominent local partners, including Samsung Group and Charoen Pokphand located in Thailand (known as Tesco Lotus), which also represents as appointing of very high numbers of domestic personnel to various management positions as well. In addition, Tesco Plc also makes trivial acquisitions and take over’s as an effective part of its regular business expansion strategy, for example, in Tesco Plc’s 2005 and 2006 financial year, it successfully made an acquisitions in South Korea, other one in Poland and also one in Japan. However, the following table consistently depicts the various numbers of stores, the total size of store with respect to area and sales for Company’s foreign operations and other important statistic as well. Country Entered Stores Area (m² (sq ft)) Mean store area (m² (sq ft)) +/- Stores 2011/12  Mainland China 2004 124 893,913 (9,622,000) 7,209 (77,476)  19  Czech Republic 1996 322 538,559 (5,797,000) 1,673 (18,003)  61  Hungary 1994 213 678,285 (7,301,000) 3,202 (34,439)  7  Republic of Ireland 1997 137 319,586 (3,440,000) 2,333 (25,109)  7  Japan 2003 121 36,790 (396,000) 304 (3,273)  19  Malaysia 2002 47 350,988 (3,778,000) 7,800 (83,956)  9  Poland 1995 460 827,394 (8,906,000) 2,008 (21,617)  41  Slovakia 1996 150 336,959 (3,627,000) 2,808 (30,225)  23  South Korea 1999 458 1,166,026 (12,551,000) 2,546 (27,404)  59  Thailand 1998 1,092 1,192,039 (12,831,000) 1,092 (11,750)  310  Turkey 2003 191 337,052 (3,628,000) 2,277 (24,514)  27  United Kingdom 1919 2,975 3,585,314 (38,592,000) 1,205 (12,972)  260  United States 2007 185 173,279 (1,870,000) 937 (10,108)  21 Total (not including UK) 3,376 6,851,321 (73,747,000) Mean: 2,029 (21,844)  565 Total (including UK) 6,351 10,436,635 (112,339,000) Mean: 1,643 (17,688)  823 Source: www.tescoplc.com Some essential highlights on Company’s performances and financial standings The figures depicting in the table below, represents all the figures for Tescos financial years, that effectively runs for 52 or 53 week periods on an aggregate basis to late February. The key figures included in the table, highlights annual turnover, profit before and after tax and finally, earning per share. 52/3 weeks ended Turnover (£m) Profit before tax (£m) Profit for year (£m) Basic earnings per share (p) 22 February 2014 70,894 3,054 2,259 32.05 23 February 2013 64,826 3,549 3,453 35.97 25 February 2012 64,539 3,985 2,814 34.98 26 February 2011 67,573 3,535 2,671 33.10 27 February 2010 62,537 3,176 2,336 31.66 28 February 2009 54,300 3,128 2,166 28.92 23 February 2008 47,298 2,803 2,130 26.95 24 February 2007 46,600 2,653 1,899 22.36 25 February 2006 38,300 2,210 1,576 19.70 26 February 2005 33,974 1,962 1,366 17.44 Source: www.tescoplc.com The data above significantly highlights some of the important performances statistics of Tesco Plc for the past 10 years. As quit witnessed from the table, despite being in a phase of recession, Tesco Plc made a record profits in the year 2010 as a British retailer, during which its overall pre-tax profits rose up by almost 10.1% to £3.4 billion. In addition, Tesco now plans out to create over 16,000 new jobs and openings under its current plan of business expansion, out of which 9,000 will cover the region of UK. Thus, from the above table the historic and current performance indicators of Tesco Plc can be well studied and analyzed in a quite simple and dramatic way. Analysis of Various HR functions in line with current joint venture plans of Tesco Plc Recruitment and selection Recruitment and selection of employees encompasses an organization to carry out certain process in order to generate a various pools of candidates from which an appropriate and suitable number of candidates can be selected by HR department and other management personnel of a Company to fill that target job vacancies (Torrington, Hall and Torrington, 1998). However, with respect to current scenario of Tesco Plc, indulging in joint venture relationships with some foreign partners to carry out its growth prospective in the region of China, a Company needs to observe its policies and regulations of hiring, recruiting and selecting a respective number of candidates for its new business plan and perspective in China. Hence, at first Tesco Plc in collaboration with its joint ventures partner, would have to identify and ascertain on realistic basis, that at what extent they are planning to establish the new business office, locations and operations in China and after that they would have to properly evaluate that how many number of employees at which designations that they would be needing and willing to hire, recruit and select to meet up their Human Resource needs. Moreover, it would also be required by the Company to relocate some of its existing employee from the location of it principal country to new region of China, so that well mix and blend of employees with both experienced and young blood can take the Company operations to touch the new heights of business horizons. As a minimal requirement, a company would be looking for the following processes when it comes to recruiting and hiring of prospective candidates (Beardwell, n.d.); Identifying a job vacancy Specifying the requirements of the job The skills needed to perform the job competently Deciding on the appropriate method of application Choosing the appropriate method of advertising the vacancy Devising the procedures for dealing with applications Training and development Training and employee’s development need and requirement would be regarded as the most important determinent for the ultimate success or failure of the new business operation of Tesco Plc in China. As, the company would be hiring on a greater extent a huge number of employees with no previous association with Tesco Plc or related industry and as a result, most of them would be least aware as to the basic rules, regulations, working methodologies, policies, functions, organization hierarchical structure and other factors of Tesco Plc. Therefore, these young blood of inexperienced lot of newly hired employees of Company would be needing certain significant, comprehensive and well organized training and development programs and seminars and orientation sessions by company trained, skilled and experienced workforce in immediate timeframe. Moreover, company can specifically use the different available mechanisms and tools of trainings in order to achieve various positives change and transformations in its employees that includes, employee development, staff development, self development of employees (both personal and professional), management and organizational development and Continuing Professional Development (CDP) (Ribeaux and Poppleton, 1985). Consequently, with the help of these training sessions, a significant number of employees would gain the following benefits and advantages by attending various training programs and sessions; Training opportunities attract and help talented workers Training increase worker productivity Training increase workers’ job satisfaction Training keeps workers up-to-date Training helps to motivate workers Reward management Reward can be defined as all the monetary, non-monetary, intrinsic, extrinsic and psychological form of payments that any organization provides or pay off to its employees or workforce in exchange for or as a consideration for the work, task, assignments or projects they perform for the company (Bratton and Gold, 2007). Thus, defining, maintaining and revising the reward structure and plan as per the changing needs and requirements of external and internal organizational environment, competitive forces and employee expectations and development, falls under one of the basic and core responsibilities of HR strategy and department. Hence, in the particular situation of Tesco Plc, extending its operation in outer circle of UK, i.e. in China, a company has to give due considerations to the terms and conditions of its current reward system, so as to fit and adjust it as per the needs, culture, expectations and values of the local community of people living in China. Because, this step by company would probably win the confidence and courtesy of the local community in China and especially its employees belonging to such locality and then after, a Company would get one step more closer in setting up its foreign operation in China on successful basis. Performance Management Performance management is considered as one of the most vital process in HR framework of any organization which effectively encompasses to achieve better results and outcomes through understanding, controlling, evaluating and managing the performance of each and every employee of a company with the help of an agreed framework of planned standards, goals and competence requirements (Bratton and Gold, 2007). As it is quite clear, that performance appraisal due importance is included in almost every organization’s HR strategic plan and framework because to motivate employees and to keep the workforce with some basic margins of pressure to perform becomes the ultimate requirement of this modern era of professionalism. Accordingly, Tesco Plc would have to properly design, evaluate, implement and manage with the help of HR department, its new performance management and appraisal system within its new era of operation in China, so that the defined targets, standards and expectations of the Company top management is clearly set and communicated to new lot of employees together with experienced one that what exactly a Company wants them to do and how to do within a realistic timeline or deadline. Thus, as a result of this step by Tesco Plc, there would be probable chances that a well bunch of its new workforce performed in a better and positive way in order to maintain the established standards and requirements of the Company performance management system. Further, by linking some economical or financial benefits and rewards with the performance management system in favor of employees, would further improve the results. Employee Involvement Employee involvement can be defined as the focused on direct participation of small groups and individuals, it is concerned with information sharing at work group level and it has excluded the opportunity for workers to have any inputs into high level decision making (Marchington, Wilkinson and Sargeant, 2005). Furthermore, operationally speaking employee participation may be contrasted with employee involvement in that it derives invariably from employees, or their organizations (i.e. trade unions) as opposed to being employer led (Beardwell and Claydon, 2007). The point that needs to be embarked after these definitions, is that the employee involvement and their participation is undoubtedly regarded as their most important attributes and traits, which needs to be inside them in order to accomplish successfully any task related to their job description or assigned to them by their immediate bosses in line of organizational hierarchy. However, Tesco Plc must also realize and understand the importance of these terms so that they can immediate take corrective or preventive steps in its HR strategy in order to properly accommodate the room for term such as employee involvement and participation in the overall achievement of the organizational and its various functional short term and long term goals and objectives. Conclusion and Recommendations In a conclusion, the report comprehensively states the various aspects about the Tesco Plc and its recent business developments and achievements over the period of time since its establishment, including its brief history, company profile, background, key economic drivers, and global HR system and how company values and treats its employees. Further, the report also discusses about the various cultural differences that a company needs to face when its plans to extend its operations and business activities around the global level in different cultural establishments and counties and how the company manages such sorts of issues in a tactical way. Moreover, as per the analysis done in this report on the overall HR framework and structure of Tesco Plc and its future plans of expansion in the region of China in line with its foreign joint venture partners, following are some valuable recommendations to the Company; The Company should comprehensively and on pro active basis analysis the certain core and key economic and business drivers along with the cultural issues prevailing in the areas, where it is aiming to establish the expansion of its operations so as to avoid any future encumbrances on its executable business plans. Moreover, the management of Company should also design the plans of its future feasibility of operations and financial performances after the expansion of its planned expansions, on the areas such as market operability, gross revenues and expected profit figures Further, the HR department of Tesco Plc should also perform a deep and detailed analysis on its overall elements and components of HR framework on continuous basis and update its plan to meet the changing external environment needs accordingly. Executive Summary The report effectively demonstrates about the various statistics about the international markets operability of Tesco Plc and some of its vital financial standings and performances over the period of 10 years. Moreover, each of the major and broad category of HR strategy and framework of Tesco Plc has been discussed in detail so as to how the company would successfully implement its business expansion plans in line with its new joint venture business partners. 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